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Senate Democrats’ education funding challenge

at 09:30 AM ET, 10/18/2011

After Senate Republicans filibustered President Obama’s jobs proposal last week, Senate Democrats are now taking up smaller parts of the American Jobs Act. First up: $30 billion in state education aid, meant to offset states’ aggressive education budget cutting during the recession.

The bill does indeed contain enough aid to offset state budget cuts made to education during the recession — and then some. I asked Michael Leachman, director of state fiscal research for the Center on Budget and Policy Priorities, to run the numbers. In total, he found that states’ reductions in per pupil spending over the past four years total $24.5 billion. Thirty states are now spending less than they did in 2008. The looming question, however, is whether those funds will end up in the places that have slashed education jobs the most.

On a phone call with reporters, Senate Majority Leader Harry Reid said he would introduce the bill today and decide “in the next day or two” whether to vote on it. But he was confident that it would work. “There are almost 300,000 jobs on the chopping block,” he said. “This creates 400,000 jobs and is an investment in our teachers.”

But one of the challenges in distributing education aid is that states have reacted very differently to the recession. Many have made big cuts; some have made minor ones. A few have actually increased their education budgets. This Center on Budget and Policy Priorities chart shows how wide that gap is:

Senate Democrats haven’t released details on how this aid would break down by state, but a White House fact sheet on the proposal lays down some guideposts. More money would go to states with larger populations, with increased funding targeted at lower-income school districts.

For states that have aggressively slashed budgets, the proposed influx of funding would fall short of replacing lost funds. One example is Indiana, which cut $807 million in education funding over the past three budgets, according to reports from the National Association of State Budget Officers. Under the White House proposal, the Hoosier State would get $629 million in funding.

States such as Indiana seem to be in the minority; since the Senate Democrats’ bill would provide $30 billion in aid to offset slightly more than $24 billion in cuts, the effect for most states would end up net positive. And there’s not really an easy solution to the Indianas; the federal government probably doesn’t want to reward states that have aggressively slashed education budgets with increased funding. But it does raise some challenges for getting education aid to the places where it’s needed the most.

Figuring out how much federal aid will go toward job creation is a challenge, too. More of the Recovery Act’s education funding was used to retain current jobs rather than create new ones, a Government Accountability Office study last month found. States also used their funds to make one-time investments in upgrades on technologies and infrastructure.

We know the education job losses are bad; the number of local education jobs declined by more than 24,000 last month, the most of any sector that the Bureau of Labor Statistics tracks. The harder part is figuring out what will turn those numbers around.

 
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